Thursday, June 20, 2013

UTDPLT- What's Up?

While Plantation index has recovered marginally, it hasn't broken above its intermediate downtrend line. I have presented below the composite chart of Plantation index and three plantation stocks for comparison. You would see the following:
1. KLK is testing its intermediate downtrend line
2. UMCCA has brokwn above its intermediate downtrend line and may revisit its recent high
3. UTDPLT has broken above its recent high and charging higher.

I have mentioned about UTDPLT's technical strength before (here). To see it again in such stark contrast to the Plantation index and other plantation companies, one couldn't help but wonder what's up with UTDPLT. See Chart 1 below.

Chart 1: Plantation, KLK, UMCCA & UTDPLT's weekly chart as at June 20, 2013_12.15pm (Source: Quickcharts)

FYE31/12/2012, UTDPLT reported a net profit of RM342 million on a revenue of RM1.183 billion. This is a decline from a net profit of RM374 million on a revenue of RM1.398 billion reported in FYE31/12/2011. For 1Q2013, its net profit dropped to RM65 million from RM73 million previously while revenue also declined from RM216 million from RM339 million. Based on its results for 1Q2013, UTDPLT's annualized EPS is about 124 sen. At the closing price of RM30.90 in the morning trade, UTDPLT has a PE of 25 times.

The weekly semilog chart (from Tradesignum where share price is not adjusted for dividend) shows a stock that is marching up in a steady upward channel. If the upper boundary of the channel is the target (better treat it as a cap), UTDPLT may hit a high of RM40-45.

Chart 2: UTDPLT's weekly chart as at June 19, 2013 (Source: Tradesignum)

Incidentally, CPO has just broken above its intermediate uptrend line at RM2450 yesterday. With this breakout, we may see further upside to CPO is the second half of this year.

Chart 3: CPO's weekly chart as at June 19, 2013 (Source: ifs.marketcenter)

In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, UTDPLT.


Anonymous said...

hi!alex.Thank you for the writeup on UP.I got in on UP 2 years ago at 7,60 but exited last year.One can never tell.thats share market!I am eyeing UM.can u make a comment please.

Alex Lu said...

Hi charles leong

Well, you are pretty good stock-picker! That skill will serve will well in the next 12 months because this market will be a difficult market. Stcok-picking will rule the day!

UMCCA is in an intermediate uptrend line that stretches back to November 2012. The support from that uptrend line is at RM7.35-7.40. Its immediate resistance is at RM7.60.

UMCCA is a conservative plantation group. Its share price performance reflects a steady uptrend and may outlast other plantation groups/stocks. On that count, you may add to your position at RM7.35-7.40.

Good luck!